Sainsbury’s to axe 3,000 jobs due to cost pressures

Sainsbury’s has announced it will cut more than 3,000 jobs, close down its in-store cafes, and remove its pizza and hot food counters from stores.

The supermarket giant said the job losses, which affect about 2% of its 148,000 staff, are part of plans to “simplify the business” amid a “particularly challenging cost environment”.

As well as affecting shop-floor staff, the move will involve axing 20% of senior management workers over the coming months as part of a shake-up of its head office.

National insurance

Sainsbury’s was already pushing to save £1 billion over the coming years, but the cut in senior management roles is reportedly linked to the recent increase in company national insurance contributions (NICs) in the October Budget.

Sainsbury’s said in late 2024 that changes in the Budget would mean an extra £140 million in costs, with chief executive Simon Roberts warning of potential “tough choices” as a result.

Mr Roberts said Sainsbury’s is “facing into a particularly challenging cost environment which means we have had to make tough choices about where we can afford to invest”.

Job cuts

The job cuts come after Sainsbury’s announced its “biggest ever” Christmas sales period, and said it would make about £1 billion in annual profit.

But the supermarket is also trying to reduce costs by £1 billion in the coming years, and in 2024 it cut about 1,500 roles.

The Unite union, which represents more than 7,000 Sainsbury’s workers, said the cuts were a result of “corporate greed”, pointing to large profits at the retailer in recent years.

Bally Auluk, national officer of the shop workers union, said it would be “working hard to ensure our members are supported throughout the process and as many people as possible remain in employment with the company”.

The latest job cuts will see the company “explore redeployment opportunities where this is possible” for people affected.

Sainsbury’s also said earlier in January that it would give staff a 5% pay increase in 2025 to help workers through a “particularly tough cost inflation environment”.

‘Difficult choices’

The retailer has also decided to close its remaining 61 Sainsbury’s Cafes, saying shoppers do not use the cafes regularly.

It will also close its remaining patisserie, hot food and pizza counters in-store and make the most popular items available in the aisles instead.

Mr Roberts said: “The decisions we are announcing today are essential to ensure we continue to drive forward our momentum but have also meant some difficult choices impacting our dedicated colleagues in a number of parts of our business.”

He added: “We’ll be doing everything we can to support anyone impacted by today’s announcements.”